^^^ My thoughts exactly. ^^^

 

Indigo is making big money right now but they have to be getting impatient to start cashing out with an IPO, the additional release of shares, then throwing up the "for sale" sign for the final pay out. Franke isn't getting any younger, time is precious.

 

Agreed. And the price of fuel is due to take a jump after the election in November (as it very often does), and it's over due anyway. Even though I think the ULCCs can thrive in a high fuel cost market, I believe the negative effect it will have in the majority of U.S. Airlines will cast a large shadow - big enough sway investor confidence in our ULCCs. IMO, the timing for an IPO is as good as it can get for the near future.

 

How does an IPO affect us as pilots? I mean aside from the equity stake payout that the non-new guys have coming to them. Does it improve our odds for a great new contract quickly? Does it fix our operational problems? Do we get new bosses? I'm not sure if I should be excited or not. Honest question - but if it's rhetorical, so be it. Spirit is publicly owned and it's all roses and cupcakes

 

In order for the pilots to receive their 4% equity share, we must pass a hard date of 01JAN2020 or Indigo Partners has to release their majority share in the company, whichever occurs first.

The company going public means that their financials become public. And they can be less shady about disguising financial performance, unless they want the SEC to come down on their heads. They're entire bargaining position is based upon "challenging business conditions." Having Frontier's financial information public that indicates the exact opposite, extremely favorable conditions, would certainly destroy their bargaining position and would be the "cherry on top" for submitting a request to the NMB for mediation over section 6 negotiations.

The operation after the IPO, who knows, that really is the biggest question. With a public company they're inviting public shareholders to have a say in their business. Maybe the operation and labor relations take a positive turn. Maybe we're merged with another company before we see a change in the operation or labor relations. It's all a wild guess at this point.

 

My hope is that anything that gets us beyond this fix-and-flip stage will be beneficial to the pilot group.

I think even our draconian management team knows that some of the stuff they're pulling now is not sustainable in the long run. For now though, it makes our numbers look 0.007% better so we do it.

Once we're owned by someone (general public via an IPO or another carrier via a merger) who's interested in running an airline for the long term, I think conditions will improve.

But I've been wrong before.

 

Mtn & Open √ and √. Thanks guys.

 

Do you really think an IPO will be offered with your continuing pilot contract unresolved?

 

Sure. You think the average Wall Street investor gets as wrapped around the axel about pilot contracts as we do? Airlines are virtually always in negotiations of some sort. They don't care nearly as much as you think. As long as the company is profitable and growing, investors think they will make money.

 

I don't think you understand the factors that drive the price of fuel.

At the end of the day, it's a supply/demand problem that is truly unaffected by any election.

If high fuel cost is driven by excessive demand, well then business is good and everyone prospers (at least temporarily).
If high fuel cost is driven by strife and restricted demand (ie embargo) etc, then that will be problematic for the whole economy much more quickly.

Chances of the first happening seem really low due to worldwide economic slump at the moment.
Chance of the latter seems somewhat remote as many parts of the world are now producing oil and are eager to sell due to waning budgets.

I think it's yet to be determined that ULCC's will "thrive" in a "high fuel cost market" as that generally affects the budget conscious / pleasure traveler even more than the business market, but both are affected.

Also, when fuel is high, market priced labor is less of a piece of the cost of producing the widget than having sub market wages as the high fuel cost overrides all.

Bottom line, high fuel is not really good for anyone in this industry, and IMO would affect the ULCC's as well. I guess we'll see if your hedge on the industry is correct (well after your predicted fuel spike in November anyway). Best of luck to all of us.